GST Basics #6: Sections 22 to 24 — Who Has to Register for GST, and When

Registration is where GST actually begins. Three sections decide it: Section 22 sets the turnover threshold, Section 23 lists who stays out, and Section 24 lists who must register no matter how small.

The last two instalments settled what a supply is and whether it is goods or services. The next question is more practical: does GST apply to you at all? Three sections answer it, and they have to be read together.

Section 22 is the turnover rule. You must register in every State from which you make taxable supplies once your aggregate turnover in a financial year crosses the threshold. The general limit is ₹20 lakh. For a person supplying goods only, it was raised to ₹40 lakh by Notification No. 10/2019-Central Tax, and Tamil Nadu follows that higher limit. So a Chennai trader dealing purely in goods has ₹40 lakh of headroom, while a consultant, a contractor or anyone supplying services works to ₹20 lakh.

Aggregate turnover is defined in Section 2(6), and it is wider than most people expect. It is computed on your PAN across all of India, not per State, and it includes exempt supplies, exports and stock transfers to your own branches in other States. It excludes GST itself and the value of inward supplies on which you pay tax under reverse charge. That means a business with ₹15 lakh of taxable sales and ₹10 lakh of exempt sales has already crossed ₹20 lakh.

Section 22 also carries two transfer rules. If a business is transferred as a going concern, the transferee registers from the date of transfer. If it passes under a court-approved amalgamation or demerger, registration runs from the date the Registrar of Companies issues the incorporation certificate.

Section 23 lists who is not liable at all: a person supplying exclusively goods or services that are wholly exempt or not taxable, and an agriculturist, to the extent of produce out of the cultivation of land. The Government can also exempt classes of persons by notification. After the Finance Act 2023 amendment, applied retrospectively from 1 July 2017, Section 23 overrides Section 24 — so a person covered by Section 23 stays out even if Section 24 would otherwise have caught them.

Section 24 is the compulsory list, and here turnover is irrelevant. It covers anyone making inter-State taxable supply of goods, casual taxable persons, non-residents, persons liable under reverse charge, agents supplying for a principal, e-commerce operators and most people supplying through them, Input Service Distributors, TDS deductors under Section 51, and OIDAR suppliers. Suppliers of services across State lines get relief up to ₹20 lakh under Notification No. 10/2017-Integrated Tax, but for goods there is no such cushion — one inter-State sale makes registration compulsory.

What this means for you: the application is due within 30 days of becoming liable, under Section 25. Casual and non-resident taxable persons must apply at least five days before starting business. Register at https://www.gst.gov.in; the bare text of the Act is on the CBIC portal at https://taxinformation.cbic.gov.in.

Next in this series: Section 9, the charging section — who pays, on what value, and at what rate.

Topics:GST registration thresholdsection 22 CGSTsection 24 compulsory registrationaggregate turnover 2(6)40 lakh limit goodscasual taxable personinter-state supply registratione-commerce GST registrationGST basics ChennaiTamil Nadu GST registration

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